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Founder's Son Says He'll Quit Position at Mercury Savings

November 24, 1987|JAMES S. GRANELLI | Times Staff Writer

In a cryptic statement issued Monday, William A. Shane, the son of Mercury Savings & Loan Assn. Chairman Leonard Shane, said he will resign his position as president of the institution "at a mutually convenient time" in the "near future."

William Shane, 36, who has been president of the Huntington Beach-based S&L for 14 months and an employee for 13 years, said he had no specific plans but wanted "to pursue other ideas" in or out of the industry.

His duties will be assumed by his father, who will remain chairman and chief executive officer. The elder Shane, 65, helped found Mercury in 1965, and the family owns about 15% of the S&L.

The announcement fueled speculation among industry consultants that the younger Shane was being eased out because of the S&L's steadily decreasing earnings. Mercury posted a $2.2-million net loss in the third quarter.

But Leonard Shane said there was no truth to such speculation, stating that his son simply decided he "was going to direct his life in a different way." The elder Shane, who expressed support for his son's decision, said the public announcement was made because Mercury is a public company and, by law, must disclose any changes involving officers.

"Leonard's under some pressure there because some mistakes were made in certain areas," said Gerry Findley, a Brea-based financial institutions consultant. Among those mistakes, by the S&L's own admission, was Mercury's reliance on fixed-rate loans, which resulted in a drop in earnings when interest rates went up in April.

In the first nine months of 1987, Mercury's net income fell to $3.1 million, from $9.3 million in the same period last year.

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